• Strong investment demand for industrial building conversions under the 'revitalisation scheme' resulted in the removal of 17.8 million sq. ft. of industrial space from the market between 2010 and 2018. While this has provided a welcome boost to office and retail supply, it has created a bottleneck in the industrial leasing market.

• The government terminated the revitalisation policy in March 2016, when factory and warehouse vacancy stood at 5.0% and 4.4%, respectively. However, rapid development of tech and other emerging sectors has stimulated the growing demand for alternative use of industrial space. This prompts the government to announce in its 2018 Policy Address that the revitalisation policy will be reintroduced this year.

• This report by CBRE audits the impact of the original scheme (Scheme 1.0), compares it with the revised scheme (Scheme 2.0), and identifies opportunities and strategies for industrial property investors and occupiers.